Taiwan exits recession on Q2 GDP growth

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TAIPEI: Taiwan came out of recession in April-June, data showed on Friday, as a pick-up in the island’s key electronics sector helped end a run of three successive quarterly contractions.

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The 0.69 percent year-on-year growth beat expectations and comes after newly elected President Tsai Ing-wen pledged to kickstart growth, including establishing a “Silicon village” for Asia.

Traditionally an export-driven technology hub, the island is home to industry giants such as Foxconn and Taiwan Semiconductor Manufacturing Co. (TSMC), which a key suppliers for Apple’s iPhone.

But China has been pushing to grow its own tech sector, with the development of domestic smartphone brands and homegrown hardware like Huawei, while sluggish global demand has also acted as a drag.

However, the latest growth figures show a rise in semiconductor, electronic components and computer industries in the second quarter, having fallen 10 percent in the same period last year.

“The second quarter [gross domestic product]is better than a forecast of 0.48 percent increase made in May mainly thanks to better-than-expected exports,” the statistics bureau said in a statement.

In May Taipei revised down its growth forecast for this year to 1.06 percent, from the 1.47 percent predicted in February.

The island’s poor economic performance under former president Ma Ying-jeou’s administration played a major role in the Kuomintang party’s defeat in January’s general election.

In her inaugural speech Tsai—of the China-skeptic Democratic Progressive Party (DPP)—pledged to diversify away from dependence on China as a trade partner in order stimulate the economy as well as developing key specialist areas, including bio-tech, defense and green energy.

AFP

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